County Makes A Lansing Wish List
GRAND RAPIDS — One of Kent County’s top three state legislative issues this year is to protect owners of the largest hotels in the county from falling under another lodging tax law.
“We don’t want our hotel operators to pay more than their fair share,” said Daryl Delabbio, county administrator and controller.
Part of that priority may also be to keep lodging tax receipts from falling further.
The issue revolves around the current lodging excise tax and a “sister law.”
Under the current method, local operators charge guests a 5 percent tax on their room bill. The county uses most of that revenue to fund the convention and tourism industry. In turn, promoting tradeshows and tourism draws paying customers to area hotels and motels.
Counties with a population of less than 600,000 can enact this lodging-excise tax, also known as the hotel-motel tax, and
The “sister” law in question is the State Convention Facility Development Act. Passed to help pay for the construction of Cobo Hall in
Only counties with a population of at least 600,000 can enact this law.
But projections for
The county feels that hotel operators who are collecting taxes under the existing method should be excluded from having to do the same under the “Cobo” law.
Under the convention facility act, hotels with 160 or more rooms add a surcharge of 6 percent to their guests’ bills. If enacted here, it would raise the local tax on the county’s largest hotels by 1 percent. But smaller hotels and motels are able to charge their guests a lower fee under that statute. So many hotels here could tack on a 3 percent surcharge instead of the current 5 percent, if the law isn’t amended when the county exceeds 600,000.
“This is not a critical issue,” said County Fiscal Services Director Robert White.
“We have five years to work on this.”
Becky Bechler of Public Affairs Associates, the county’s lobbyist, told members of the county’s Legislative Committee last week that Sen. Nancy Cassis of Novi opposed
Bechler said her firm would draft a new amendment and suggested that the county find a
The county expects to receive about $4 million in lodging-tax revenue from last year, an amount based on a hotel-occupancy rate of 54.5 percent. Occupancy was slightly under 55 percent for 2004, with about 112,000 room nights being booked last year.
The lodging revenue made a bond payment on the
And switching five years from now to the collection method used in metro
The county’s other top priorities at the state level are to limit the county’s medical liability for inmates and to get low-income households a deferment from the property tax bill due in July.
A third of the annual property tax is due this summer because state lawmakers amended the property tax act last year. Commissioners are concerned the payment-date change will be a hardship for low-income residents, as many might not have enough money set aside in escrow to pay that portion of the tax.
White said allowing these residents to defer their payments would not be a significant financial blow to the county, but could be a bigger hit for other groups receiving property-tax revenue. Bechler said she would check with Treasury officials to find out how they feel about the issue.
The county also wants state legislators to put a lid on medical expenses for inmates at the county jail and juvenile detention center. The county spends about $5 million on medical care for prisoners at both facilities each year.
A bill introduced in the state Senate last year that would have curbed a county’s medical liability for emergency care to $250 annually per inmate never made it out of committee. Bechler said Public Affairs would attempt to get a new bill introduced this session.
“I think we have an opportunity to reverse something,” said County Commissioner Dan Koorndyk, who chairs the Legislative Committee.